This is a Sponsored Thought Leadership article by legal AI pioneer, Kira Systems.
Banish Three Regulatory Ghosts with AI this Holiday Season
Rarely a day goes by that global headlines don’t remind us that serious regulatory changes are coming in the new year, whether it be Brexit, GDPR, or IFRS 16.
As corporations scramble to understand how these changes will impact their businesses, professional service teams around the world want to protect their clients by offering advice that is quick, proactive, and actionable.
As we come into 2018, why not make it a happy holiday for your clients by anticipating their compliance risks for them? By combining the expertise of professionals with machine learning technology, a preliminary contract review can be quick and cost-effective. As our gift to you, we’re sharing how some organizations have implemented AI solutions to help them banish these regulatory concerns in the year ahead.
The General Data Protection Regulation (“GDPR”) aims to strengthen data protection for EU residents. The regulation also addresses the export of information outside the EU and as a result will impact any company doing business in the EU. This places a significant burden on companies all over the world to ensure they understand what EU personal data they are collecting, processing, using and storing, and take appropriate action before GDPR comes into effect on May 25, 2018.
TIBCO Software Inc. has been using technology to ensure it complies with the upcoming changes. TIBCO is based in Palo Alto, but their software manages information, decisions, processes and applications for over 10,000 customers, including Air France-KLM, Citi, Conway, ING, Marks and Spencer, and Symantec.
Rafael Carmona, Vice President of Global Licensing at TIBCO, is responsible for ensuring that the company monitors its contractual obligations, and takes appropriate action to ensure ongoing compliance with its agreements and EU Data Protection legislation. In order to track and assess its existing contractual obligations, TIBCO uses Kira to automate the extraction and analysis of data from their contracts. The review stage is fast and accurate, so TIBCO can focus on implementing processes that ensure compliance with both GDPR and their agreements.
As companies hurry to prepare for an uncertain Brexit outcome, and their advisors assemble teams that can provide specialized assistance, it’s difficult to balance the many competing demands for time and money. In order to determine which of their agreements may be affected or require change in advance of the 2019 Brexit deadline, companies could need to review their entire population of contracts for a number of potential issues, including the enforceability of key provisions.
Using Kira, Kemp Little LLP has developed a Brexit tool to help in-house counsel get ahead of these issues. Lawyers at the firm quickly help clients identify which contractual arrangements are likely to be affected by the European Union (Withdrawal) Bill by red-flagging clauses such as choice of law and jurisdiction. This gives the team the opportunity to proactively provide clients with clear risk assessments of the issues they’ve uncovered and how they can be remedied.
Tania Williams, Commercial Technology Partner at Kemp Little, led the program to identify the critical information in client contracts that required review. Her team trained Kira to identify key clauses that have now become a standard part of the firm’s client service program.
Ms. Williams noted the importance of getting a head start on these reviews: “It’s important for us to help our clients identify these hidden risks now, so they can make any necessary changes to their contractual relationships, and know what issues to keep in mind when entering into agreements going forward.” Using machine learning software, the firm was able to make this otherwise daunting regulatory compliance issue less complicated and burdensome.
The consequences of the new IFRS 16 lease accounting standard will be similarly far reaching. Companies, especially those with complex or high volume leasing arrangements, must begin planning for these changes well ahead of the January 1, 2019 deadline.
The team at Deloitte LLP is working hard to help their clients stay one step ahead as they come into 2018. As early as this past summer, Deloitte used Kira to quickly review thousands of equipment and real property leases for over 40 data points in French and English using custom-built provision models. Kira exported the results directly into Excel so their experienced audit and advisory teams could provide clients with a detailed risk assessment.
Andrea Taylor, partner at Deloitte and the leader of the Legal Project Solutions team, recently described the issue: “Many customers do not have the scalable internal resources to complete the review of these leases, or underestimate just how many leases they have to review. We have adopted state-of-the-art technology that allows us to provide efficient, high quality contract review services to clients so that they can focus their resources on higher-value tasks.”
So, with these specters lurking in 2018, one question for professional service teams across the world to think about is: “Are you doing enough to help your clients prepare for 2018?”
Companies should also find out whether the technology their firm uses can help them confidently address these changes. A number of the world’s top companies and professional service firms use Kira to improve their efficiency and amplify their team’s expertise so they are prepared for anything 2018 throws their way.
And that’s worth raising a glass to.